Montenegro looks set to restore the independence it gave up in 1918, at the end of World War I.

That was when it joined Serbia in the new state that was to become Yugoslavia.

European Union foreign policy chief Javier Solana commended the conduct of Sunday's referendum in Montenegro and said he would respect the result.

The first formal step in reviving Montenegro's statehood will involve convening parliament in Podgorica to proclaim the country's independence.

Serbia's role will be crucial for two reasons.

Under the Belgrade Agreement of 2002, which revamped the Yugoslav federation as the loosely-knit union of Serbia and Montenegro a year later, Serbia will become the successor-state to the union if Montenegro opts for independence.

Serbia will inherit the union's seat at the United Nations and in other international institutions.

Montenegro will have to apply for membership in international organisations once it has been granted recognition by other states.

Serbia's successor status also favours it in forthcoming negotiations in dividing the union's relatively few assets: the buildings housing the handful of joint institutions in Belgrade, diplomatic missions and army property.

Need for co-operation

But Montenegro's hand will be strengthened once its independence cuts off Serbia from access to the Adriatic Sea and the union's navy.

Podgorica could hold out the prospect of granting special access rights to Belgrade in return for a co-operative approach on sharing out the union's assets and perhaps giving favourable treatment to Montenegrins who want to carry on using Serbia's hospitals, universities and other public services. Choice is somewhat limited in their tiny republic of just 650,000 inhabitants.

Serbia can also play an indirect role in helping Montenegro's smooth transition to independence by exercising a calming influence on Montenegro's substantial pro-union minority.

Many of the unionists - the majority of whom are ethnic Serbs - are angry at the prospect of Montenegro going its own way, and Belgrade can help their leader, Predrag Bulatovic, exercise restraint to prevent political turmoil turning into violence.

EU membership bid

The EU is another key player that can contribute to bolstering political stability in Montenegro and the wider Balkan region in the wake of the referendum vote.

Opponents of independence said the economy would suffer

It was the EU's insistence on a qualified majority - the 55% threshold for the independence vote - that helped ensure a high turnout of over 86%, because neither side could be certain that it would win unless it could get the maximum number of its supporters.

The high turnout and the 55% threshold - in other words, a required majority of at least 10% for independence - lends legitimacy to the results, even if some on the losing side will continue to question the figures.

Once the pro-independence vote is confirmed, Montenegro will be seeking recognition from the EU and its member states.

It will also be asking for the EU to draw up a separate mandate for preliminary negotiations leading to Montenegro's eventual EU membership - in other words, for talks aimed at the conclusion of a Stabilisation and Association Agreement (SAA).

Earlier this month, the EU suspended its SAA talks with Serbia and Montenegro because of Serbia's failure to transfer to The Hague war crimes tribunal the Bosnian Serb wartime military commander, Ratko Mladic.

Montenegro's Prime Minister Milo Djukanovic has been arguing that his republic would complete its integration with the EU much more quickly if it negotiated with Brussels as an independent state.

But if the suspension of talks with Serbia persists for more than a few months, Montenegro's independence advocates may yet be proved right, and Podgorica could overtake Belgrade in its talks with the EU.

Kosovo issue

That will be all the more so if Serbia's attitude to the current talks on UN-administered Kosovo's future status is deemed by the EU to be negative at a time when the international community seems to be edging towards giving Kosovo some kind of qualified or limited independence.

But that will only harden Kosovo Albanians' resolve to be granted independence.

And in the light of Montenegro's referendum they are expected to renew their calls for a plebiscite of their own, knowing that an overwhelming majority, perhaps 90% of Kosovo's ethnic Albanians, would opt for independence.